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§ 1.64Composition of various self-regulatory organization governing boards and major disciplinary committees.

(a)Definitions. For purposes of this section:

(1)Self-regulatory organization means “self-regulatory organization” as defined in § 1.3(ee), not including a “clearing organization” as defined in § 1.3(d).

(2)Major disciplinary committee means a committee of persons who are authorized by a self-regulatory organization to conduct disciplinary hearings, to settle disciplinary charges, to impose disciplinary sanctions or to hear appeals thereof in cases involving any violation of the rules of the self-regulatory organization except those which:

(i) Are related to:

(A) Decorum or attire,

(B) Financial requirements, or

(C) Reporting or recordkeeping; and,

(ii) Do not involve fraud, deceit or conversion.

(3)Regular voting member of a governing board means any person who is eligible to vote routinely on matters being considered by the board and excludes those members who are only eligible to vote in the case of a tie vote by the board.

(4)Membership interest (i) In the case of a contract market, each of the following will be considered a different membership interest:

(E) Participants in a variety of pits or principal groups of commodities traded on the particular contract market; and,

(F) Other market users or participants; except that with respect to paragraph (c)(2) of this section, a contract market may define membership interests according to the different pits or principal groups of commodities traded on the contract market.

(ii) In the case of a registered futures association, each of the following will be considered a different membership interest:

(E) Associated persons, except that under paragraph (c)(3) of this section an associated person will be deemed to represent the same membership interest as its sponsor.

(b) Each self-regulatory organization must maintain in effect standards and procedures with respect to its governing board which have been submitted to the Commission pursuant to section 5a(a)(12)(A) of the Act and § 1.41 or, when applicable to a registered futures association, pursuant to section 17(j) of the Act, that ensure:

(1) That twenty percent or more of the regular voting members of the board are persons who:

(i) Are knowledgeable of futures trading or financial regulation or are otherwise capable of contributing to governing board deliberations; and,

(ii) (A) Are not members of the self-regulatory organization,

(B) Are not currently salaried employees of the self-regulatory organization,

(C) Are not primarily performing services for the self-regulatory organization in a capacity other than as a member of the self-regulatory organization's governing board, or

(D) Are not officers, principals or employees of a firm which holds a membership at the self-regulatory organization either in its own name or through an employee on behalf of the firm;

(2) In the case of a contract market, that ten percent or more of the regular voting members of the governing board be comprised where applicable of persons representing farmers, producers, merchants or exporters of principal commodities underlying a commodity futures or commodity option traded on the contract market; and

(3) That the board's membership includes a diversity of membership interests. The self-regulatory organization must be able to demonstrate that the board membership fairly represents the diversity of interests at such self-regulatory organization and is otherwise consistent with this regulation's composition requirements;

(c) Each self-regulatory organization must maintain in effect rules with respect to its major disciplinary committees which have been submitted to the Commission pursuant to section 5a(a)(12)(A) of the Act and § 1.41 or, when applicable to a registered futures association, pursuant to section 17(j) of the Act, that ensure:

(1) That at least one member of each major disciplinary committee or hearing panel thereof be a person who is not a member of the self-regulatory organization whenever such committee or panel is acting with respect to a disciplinary action in which:

(i) The subject of the action is a member of the self-regulatory organization's:

(ii) Any of the charged, alleged or adjudicated contract market rule violations involve:

(A) Manipulation or attempted manipulation of the price of a commodity, a futures contract or an option on a futures contract, or

(B) Conduct which directly results in financial harm to a non-member of the contract market;

(2) In the case of a contract market, that more than fifty percent of each major disciplinary committee or hearing panel thereof include persons representing membership interests other than that of the subject of the disciplinary proceeding being considered;

(3) In the case of a registered futures association, that each major disciplinary committee or hearing panel thereof include persons representing membership interests other than that of the subject of the disciplinary proceeding being considered; and,

(4) That each major disciplinary committee or hearing panel thereof include sufficient different membership interests so as to ensure fairness and to prevent special treatment or preference for any person in the conduct of a committee's or the panel's responsibilities.

(d) Each self-regulatory organization must submit to the Commission within thirty days after each governing board election a list of the governing board's members, the membership interests they represent and how the composition of the governing board otherwise meets the requirements of § 1.64(b) and the self-regulatory organization's implementing standards and procedures.

[58 FR 37654, July 13, 1993; 59 FR 5082, Feb. 3, 1994]

Title 17 published on 2014-04-01

The following are only the Rules published in the Federal Register after the published date of Title 17.

For a complete list of all Rules, Proposed Rules, and Notices view the Rulemaking tab.

2014-09-26; vol. 79 # 187 - Friday, September 26, 2014

79 FR 57767 - Exclusion of Utility Operations-Related Swaps With Utility Special Entities From De Minimis Threshold for Swaps With Special Entities

The Commodity Futures Trading Commission (Commission or CFTC) is amending its regulations (Amendments) in order to permit a person to exclude utility operations-related swaps entered into with utility special entities in calculating the aggregate gross notional amount of the person's swap positions, solely for purposes of the de minimis exception applicable to swaps with special entities.

The Commodity Futures Trading Commission (“CFTC”) is correcting final rules published in the Federal Register of November 14, 2013 (“final rules”). Those rules, which adopted new regulations and amended existing regulations requiring enhanced customer protections, risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures, and auditing and examination programs for futures commission merchants, took effect on January 13, 2014. This correction amends erroneous cross-references found in three sections of the final rules. Additionally, this correction amends one section of the final rules to insert language that was in the proposed rulemaking, and which was stated as being adopted in the preamble to the final rules, but was erroneously omitted from the final rule text.

The Commodity Futures Trading Commission (“Commission” or “CFTC”) is correcting final rules published in the Federal Register of November 14, 2013 (78 FR 68506). Those rules, 17 CFR Parts 1, 3, 22, 30, and 140, took effect on January 13, 2014. This correction amends Appendix B to 17 CFR 1.20 and Appendix B to 17 CFR 1.26 by removing a phrase from both appendices.

This is a list of United States Code sections, Statutes at Large, Public Laws, and Presidential Documents, which provide rulemaking authority for this CFR Part.

In accordance with section 712(d)(4) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”), the Commodity Futures Trading Commission (the “CFTC”) and the Securities and Exchange Commission (“SEC”), after consultation with the Board of Governors of the Federal Reserve System (“Board of Governors”), are jointly issuing the CFTC's proposed clarification of its interpretation concerning forward contracts with embedded volumetric optionality. The CFTC invites public comment on all aspects of its proposed interpretation.

The Commodity Futures Trading Commission (the “Commission” or “CFTC”) is proposing to amend Commission Rule 1.35(a) (the “Proposal”) to: provide that all records required to be maintained under this regulation must be searchable; clarify that all records be kept in a form and manner that allows for identification of a particular transaction, except that records of oral and written communications leading to the execution of a transaction in a commodity interest and related cash or forward transactions are not required to be kept in a form and manner that allows for identification of a particular transaction; exclude unregistered members of designated contract markets (“DCMs”) and swap execution facilities (“SEFs”) from the requirements to retain text messages and to maintain records in a particular form and manner; and exclude commodity trading advisors (“CTAs”) from the oral recordkeeping requirement.

The Commodity Futures Trading Commission (“Commission” or “CFTC”) is proposing to revise the Residual Interest Deadline in Commission Rule 1.22. The amendment would remove the December 31, 2018 termination date for the phased-in compliance schedule for futures commission merchants (“FCMs”) and provide assurance that the Residual Interest Deadline would only be revised through a separate Commission rulemaking.

2014-09-26; vol. 79 # 187 - Friday, September 26, 2014

79 FR 57767 - Exclusion of Utility Operations-Related Swaps With Utility Special Entities From De Minimis Threshold for Swaps With Special Entities

The Commodity Futures Trading Commission (Commission or CFTC) is amending its regulations (Amendments) in order to permit a person to exclude utility operations-related swaps entered into with utility special entities in calculating the aggregate gross notional amount of the person's swap positions, solely for purposes of the de minimis exception applicable to swaps with special entities.

The Commodity Futures Trading Commission (“CFTC”) is correcting final rules published in the Federal Register of November 14, 2013 (“final rules”). Those rules, which adopted new regulations and amended existing regulations requiring enhanced customer protections, risk management programs, internal monitoring and controls, capital and liquidity standards, customer disclosures, and auditing and examination programs for futures commission merchants, took effect on January 13, 2014. This correction amends erroneous cross-references found in three sections of the final rules. Additionally, this correction amends one section of the final rules to insert language that was in the proposed rulemaking, and which was stated as being adopted in the preamble to the final rules, but was erroneously omitted from the final rule text.

2014-07-03; vol. 79 # 128 - Thursday, July 3, 2014

79 FR 37973 - Position Limits for Derivatives and Aggregation of Positions

The comment periods for the Aggregation Proposal published November 15, 2013, at 78 FR 68946, and for the Position Limits Proposal published December 12, 2013, at 78 FR 75680, will close on August 4, 2014.

17 CFR Parts 1, 15, 17, 19, 32, 37, 38, 140, and 150

Summary

On December 12, 2013, the Commodity Futures Trading Commission (“Commission”) published in the Federal Register a notice of proposed rulemaking (the “Position Limits Proposal”) to establish speculative position limits for 28 exempt and agricultural commodity futures and options contracts and the physical commodity swaps that are economically equivalent to such contracts. On November 15, 2013, the Commission published in the Federal Register a notice of proposed rulemaking (the “Aggregation Proposal”) to amend existing regulations setting out the Commission's policy for aggregation under its position limits regime. In addition, the Commission directed staff to hold a public roundtable on June 19, 2014, to consider certain issues regarding position limits for physical commodity derivatives. In order to provide interested parties with an opportunity to comment on the issues to be discussed at the roundtable, the Commission published notice in the Federal Register on May 29, 2014, that the comment periods for the Position Limits Proposal and the Aggregation Proposal were reopened, starting June 12, 2014 (one week before the roundtable) and ending July 3, 2014 (two weeks following the roundtable). To provide commenters with a sufficient period of time to respond to questions raised and points made at the roundtable, the Commission is now further extending the comment period. Comments should be limited to the issues of hedges of a physical commodity by a commercial enterprise, including gross hedging, cross-commodity hedging, anticipatory hedging, and the process for obtaining a non-enumerated exemption; the setting of spot month limits in physical-delivery and cash-settled contracts and a conditional spot-month limit exemption; the setting of non-spot limits for wheat contracts; the aggregation exemption for certain ownership interests of greater than 50 percent in an owned entity; and aggregation based on substantially identical trading strategies.

2014-06-02; vol. 79 # 105 - Monday, June 2, 2014

79 FR 31238 - Exclusion of Utility Operations-Related Swaps With Utility Special Entities From De Minimis Threshold for Swaps With Special Entities

The Commodity Futures Trading Commission (Commission or CFTC) is proposing to amend its regulations (Proposal) to permit a person to exclude utility operations-related swaps with utility special entities in calculating the aggregate gross notional amount of the person's swap positions solely for purposes of the de minimis exception applicable to swaps with special entities.

2014-05-29; vol. 79 # 103 - Thursday, May 29, 2014

79 FR 30762 - Position Limits for Derivatives and Aggregation of Positions

The comment periods for the Aggregation Proposal published November 15, 2013, at 78 FR 68946, and for the Position Limits Proposal published December 12, 2013, at 78 FR 75680, will reopen on June 12, 2014, and close on July 3, 2014.

17 CFR Parts 1, 15, 17, 19, 32, 37, 38, 140, and 150

Summary

On December 12, 2013, the Commodity Futures Trading Commission (“Commission”) published in the Federal Register a notice of proposed rulemaking (the “Position Limits Proposal”) to establish speculative position limits for 28 exempt and agricultural commodity futures and options contracts and the physical commodity swaps that are economically equivalent to such contracts. On November 15, 2013, the Commission published in the Federal Register a notice of proposed rulemaking (the “Aggregation Proposal”) to amend existing regulations setting out the Commission's policy for aggregation under its position limits regime. The Commission has directed staff to hold a public roundtable on June 19, 2014, to consider certain issues regarding position limits for physical commodity derivatives. In order to provide interested parties with an opportunity to comment on the issues to be discussed at the roundtable, the Commission will reopen the comment periods for the Position Limits Proposal and the Aggregation Proposal for a three-week period starting June 12, 2014 (one week before the roundtable) and ending July 3, 2014 (two weeks following the roundtable). Comments should be limited to the issues of hedges of a physical commodity by a commercial enterprise, including gross hedging, cross-commodity hedging, anticipatory hedging, and the process for obtaining a non-enumerated exemption; the setting of spot month limits in physical-delivery and cash-settled contracts and a conditional spot-month limit exemption; the setting of non-spot limits for wheat contracts; the aggregation exemption for certain ownership interests of greater than 50 percent in an owned entity; and aggregation based on substantially identical trading strategies.

The Commodity Futures Trading Commission (“Commission” or “CFTC”) is correcting final rules published in the Federal Register of November 14, 2013 (78 FR 68506). Those rules, 17 CFR Parts 1, 3, 22, 30, and 140, took effect on January 13, 2014. This correction amends Appendix B to 17 CFR 1.20 and Appendix B to 17 CFR 1.26 by removing a phrase from both appendices.